DAILY DIGEST / Fed chief learns a lesson: He'll keep his mouth shut

Published 4:00 am, Wednesday, May 24, 2006

Ben Bernanke, the new chairman of the Federal Reserve, is likely to be a lot less interesting at dinner parties from now on.

On Tuesday, not quite four months after taking over at the Fed, Bernanke admitted to a "lapse in judgment" in earlier telling a television reporter at a banquet that investors had "misunderstood" him.

Bernanke's remarks at the White House Correspondents Dinner on April 29, to Maria Bartiromo of CNBC, touched off a brief furor among stock market traders when Bartiromo reported the conversation as an important disclosure the following Monday.

Most analysts quickly concluded that Bernanke had said little, if anything, that was new and had simply repeated his determination to keep the Fed's options open. But Bartiromo, who reported that Bernanke "had surprising comments" about the way that media and markets had interpreted his testimony to Congress a few days earlier, helped set off a round of second-guessing in the financial markets.

"Ben Bernanke told me over the weekend the media and the markets got it wrong last week in speculating the Fed is done raising interest rates," Bartiromo reported at the time.

South Korea Hires Robot Volunteers to Help With PyeongChang 2018 Winter OlympicsRuptly TV

Valentine's Day Spending to Rise This YearWibbitz

Report: Apple Music to Surpass Spotify in Paid US subscribers This SummerWibbitz

Elon Musk 'Incredibly Proud' of SpaceX LaunchAssociated Press

How Holocaust Survivor Judith Leiber Became a Handbag LegendTownAndCountry

Until Tuesday, Bernanke had refused to either confirm or deny that the conversation even took place. But asked about it at a Senate Banking Committee hearing, the Fed chairman acknowledged that he had learned the hard way that there is no such thing as idle chitchat.

"Senator, that episode you refer to was a lapse of judgment on my part," Bernanke told Sen. Jim Bunning, R-Ky. "In the future, my communications with the public and the markets will be entirely through regular and formal channels."

Bernanke might take lessons from his cryptic predecessor, Alan Greenspan, who was a fixture at Washington dinner parties, but he was so quiet that he often seemed boring.